Staffing Shortages in Healthcare: What Industry Leaders Should Know

In the 2022 American College of Healthcare Executives (ACHE) annual survey, staffing shortages replaced financial challenges as the top concern for the first time in nearly two decades. Within the issue of staffing shortages specifically, a shortage of registered nurses (RNs) was listed as the most pressing matter. Nurses have long been the lifeblood of the American healthcare system; healthcare leaders desperately need to find more effective ways to recruit, retain, and empower them.

Today’s healthcare administrators face stormy waters. Public health emergency funding is ending, while inflation has kept costs high. Meanwhile, understaffing creates its own vicious cycle, increasing burnout and worsening working conditions, making recruitment and retention even more difficult.

Read on to learn more about how healthcare leaders can address these staffing shortages effectively and build a more resilient and empowered workforce in the process.

Dr. Monica O’Reilly-Jacob is an assistant professor at Boston College Connell School of Nursing and a nursing health services researcher with a focus in primary care. Her research themes include nurse practitioner (NP) policy and practice, as well as low-value care. Through Medicare claims analysis and survey research, Dr. O’Reilly-Jacob examines NP scope of practice, the cost and quality of NP care, and (re)emerging delivery system innovations such as NP-owned practices and NP home-based primary care.

In addition, Dr. O’Reilly-Jacob participates in interdisciplinary research teams to identify and examine questions related to reducing low-value care in the primary care setting. The overarching goal of her research is to capitalize on the cost-effective practice style of nurse practitioners to improve the appropriate utilization of primary care.

Covid-19 ravaged the healthcare workforce. Pushed to the brink by burnout and fatigue, many exited the healthcare sector altogether. But this burnout was not solely specific to the public health emergency. It’d long been building due to overwork, unsupportive administrative policy, and unsatisfactory working conditions.

“While 100,000 RNs left the workforce in 2021, almost all were from the hospital,” Dr. O’Reilly-Jacob says. “Poor working conditions and subsequent burnout are major drivers, especially in hospital settings.”

Hospitals continue to face extreme financial pressure. In the fall of 2022, the American Hospital Association projected its annual losses to be in the billions of dollars, with projected margins substantially below pre-pandemic levels. Labor expenses typically account for half of a hospital’s total expenses; non-labor expenses have also remained elevated. However, workforce shortages and overall costs will worsen without thoughtful investment into recruiting and retaining the nursing workforce.

“Although early evidence suggests that RN numbers may be rebounding to pre-pandemic levels, RNs are not returning to the hospitals, but rather seeking ambulatory jobs because they are not willing to work under the current working conditions,” Dr. O’Reilly-Jacob says.

The AHA’s 2023 Healthcare Workforce Scan emphasized workforce challenges, particularly in providing the support, training, and technology that the healthcare workforce needs to thrive. But administrative policy can’t be crafted in a vacuum: it needs to involve those it seeks to help in decision-making.

“Hospital administrators should engage with their own nursing staff to consider tailored ways to improve their working conditions and subsequently improve the recruitment and retention of nurses,” Dr. O’Reilly-Jacob says. “Building trust will be key to successful initiatives.”

Dr. O’Reilly-Jacob suggests that intentional engagement with nurses can include: co-designing nursing roles that meet organizational needs and create opportunities for professional growth; offering flexibility in scheduling; promoting shared governance; offering on-site childcare or dependent care programs; and encouraging initiatives that contribute to safer workplaces.

Administrators can also incentivize delayed retirement of nursing staff. This could include encouraging nurses to provide part-time virtual care, participate in mentorship programs, or help develop succession planning. By providing flexible options that allow veteran nursing staff to continue to contribute, a healthcare organization and its staff can draw on those veterans’ expertise in a way that can, ideally, be mutually beneficial.

Another way of addressing workforce shortages is through renewed attention on nursing education. The American Association of Colleges of Nursing (AACN) has identified a lack of nursing faculty as contributing to the ongoing nursing shortage, effectively limiting student capacity when the need for nurses continues to rise. In 2021, American nursing schools turned away over 90,000 qualified applications to an insufficient number of faculty and other resources.

“The workplace environment is intricately connected to the dynamics of the nursing education landscape,” Dr. O’Reilly-Jacob says. “Collaborative partnerships with nursing schools can help ensure a robust pipeline and help improve the diversity of the workforce. Finding and investing in experienced preceptors and expanding transition-to-practice programs for new RNs is critical.”

When America faces a healthcare crisis, it looks first to its nurses. But as the Covid-19 pandemic recedes, the next crisis is already in sight: as the nation’s largest generation proceeds into old age, they’ll place an enormous demand upon the healthcare system. Fortunately, the numbers suggest nurses might be up to the task.

“Some projections suggest that by 2035, the growth of the national RN workforce will not only replace the estimated 500,000 retiring RNs but also expand the workforce by approximately 1.2 million RNs, as compared with 2020,” Dr. O’Reilly-Jacob says. “We seem to be on a good trajectory, but only if administrators can minimize the exodus of nurses responding to poor workforce conditions in hospitals.”

Advances in AI have some administrators looking at ways to automate their way out of low staffing levels. Indeed, part of the 2023 World Economic Forum Annual Meeting focused on how technology can help ease the burden of staff shortages. But new tech only works if it’s person-centered and assistive.

“While AI may offer a pressure valve for low-risk, repetitive tasks, it cannot replace the value of nursing intuition in high-risk clinical care,” Dr. O’Reilly-Jacob says. “Instead, I see the settings of care shifting out of hospitals and into the community—through models like hospital at home, virtual care, or on-demand nursing care. These delivery system innovations allow nurses autonomy to provide the type of care that they want to provide–and facilitates a work-life balance that keeps them in the workforce on their own terms.”

Hospital administrators must work with nurses and other staff to foster a safe and supportive workplace. By taking a collaborative and thoughtful approach to recruitment, retention, and empowerment, administrators can address staffing shortages and burnout head-on.

“The problem isn’t that we don’t have enough nurses; it’s that the current structure does not allow nurses to sustainably care for their patients,” Dr. O’Reilly-Jacob says. “The master of healthcare administration (MHA) community has an urgent opportunity to respond and innovate and build a stronger and more nimble RN workforce than ever before.”